What the First Flexibility Needs Assessment means for Europe 

Introduction 

At N-SIDE Connect on April 16, 2026, the discussion on flexibility made one thing clear: Europe is entering a new phase in how it thinks about system adequacy, congestion management, and the role of flexible resources in supporting the grid.

As decentralized production continues to grow and generation excesses put increasing pressure on power systems, the flexibility debate is becoming much broader than a simple question of volumes. It now spans system stability, congestion management, renewable integration, curtailment, storage, demand response, and the role of regional coordination. The Flexibility Needs Assessment (FNA), a national study to be adopted by each Member State by July 25th, brings these dimensions together and is quickly becoming one of the key frameworks for structuring the conversation.

Against that backdrop, our roundtable on the first FNA explored a set of practical questions that are quickly becoming central to Europe’s energy transition.

Why the First Flexibility Needs Assessment matters for Europe 

The first takeaway from the discussion was that the FNA does not sit in isolation. It interacts with other planning and assessment exercises, including National Development Plans (NDP), the Ten-Year Network Development Plan (TYNDP), and the European and National Resource Adequacy Assessments (ERAA, NRAA). The logic is to have well-scoped and complementary studies. One study can identify future flexibility shortages or congested network elements. Those needs can then be accounted for in network development plans or a capacity remuneration mechanism (CRM). Those network upgrades and CRM-contracted assets can, in turn, be reflected in the next round of adequacy and flexibility assessments.

This iterative loop was one of the clearest points of alignment in the discussion. Participants did not see a strong need to merge everything into one massive “integrated study.” On the contrary, the current architecture was seen as useful precisely because it allows one assessment to inform the next. Flexibility needs can trigger grid reinforcements, and those reinforcements can then be reflected in future adequacy and flexibility studies. In that sense, the overlap between FNA, TYNDP, and adequacy work can be one of the framework’s strengths.

Can the FNA provide solutions?

One of the most engaging parts of the discussion concerned the solutions to address the increasing needs for flexibility. If flexibility needs are becoming more structural, and if storage and demand response are expected to play a greater role, can the current methodology guide decisions on which technologies optimally address the needs?

The roundtable pointed out that technology neutrality remains an important principle, but it only works if the assessment captures what different flexibility solutions can actually deliver for the system and society, under the right timescales and operational conditions.

This is especially important because not all flexibility needs are of the same nature. Some are closely linked to very short-term operational challenges, such as system balancing, ramping, or incompressibility events. Others are more closely related to wider political and societal objectives, such as renewable integration and decarbonization. Keeping those layers distinct is essential if the FNA is to remain both credible and useful.

This distinction is also key in the application of support schemes for non-fossil flexibility. For TSOs dealing with operational problems, especially short-duration system events, the focus is first on having a technical solution that can secure the system in time. Participants stressed that using curtailment to keep the system secure should not be treated as taboo, especially during severe incompressibility events.

At the same time, the impact of curtailment must be reflected transparently in renewable targets and policy evaluation. Subsidies for storage and demand response to meet these targets are, therefore, more a political question than an operational one. The value of these should be judged both by the amount of electricity they can absorb and how effectively and efficiently they can return value to the system.

The FNA provides the tools to weigh all these needs and compare different policy options. Consequently, it remains essential that the FNA methodology clearly distinguishes between operational flexibility needs, long-term investment choices, and broader policy objectives.

The cross-border dimension of flexibility needs 

Next, the cross-border dimension of the FNA was discussed. Today, each country assesses its flexibility needs at the national level. Those national assessments are then brought together into a European FNA. But the assumptions behind them are not always aligned.

This becomes particularly important in periods of short-term needs. Each country may assume that part of its surplus from forecasting errors can be exported to neighboring systems. Yet if several regions face similar conditions at the same time, that assumption may prove too optimistic. 

That is why participants raised the idea of moving, over time, toward a more multi-area and probabilistic approach to flexibility needs assessment. Such an approach could better reflect the fact that multiple regions may face incompressibility or short-term stress at the same time. It would also make it easier to test whether the export assumptions used nationally remain robust when neighboring systems are under similar pressure.

What role could Regional Coordination Centres play? 

This is also where Regional Coordination Centres (RCCs) may have an increasingly important role. While the FNA remains rooted in national assessments, RCCs could help provide regional input, improve consistency across assumptions, and support a more coordinated view of cross-border flexibility needs.

This would strengthen the regional layer where national assessments interact. As European power systems become more interconnected, RCC’s support could become increasingly valuable in testing shared assumptions, identifying simultaneous regional stress, and helping ensure that the European FNA reflects not only national perspectives but also the realities of cross-border system operation.

Flexibility Markets as a tool for congestion management 

Another major topic was the role of flexibility markets for congestion management. The discussion here was pragmatic. In principle, such markets can help avoid, delay, or better plan grid expansion. But experience from countries that already use them shows that the design matters enormously.

One concern is cost. If flexible assets are free to arbitrate between congestion markets and other electricity markets, opportunity costs can become very high. That can make redispatch through market-based mechanisms significantly more expensive than expected. 

For that reason, roundtable participants challenged the idea that congestion markets are automatically the right target model. The message was more conditional: if these markets are used, they need to be designed in a way that limits uncontrolled cost escalation. That may mean stronger capacity-based features, or some form of (co)optimization that prevents redispatch costs from rising simply because assets can maximize value by arbitraging across several market layers.

This was not framed as a rejection of congestion markets. Rather, it was a reminder that they are not automatically an efficient target model just because they are market-based. To be genuinely useful, they need the right minimum conditions:

1. enough liquidity,
2. enough predictability,
3. and enough coordination with the rest of the system to avoid creating expensive distortions.

Should local and national flexibility markets be co-optimized? 

The discussion did not settle this point definitively, but it strongly suggested that fragmentation creates risks. If local and national flexibility mechanisms are developed in parallel without sufficient coordination, flexible assets may chase the highest-value signal in ways that raise overall system costs.

That is why co-optimization, or at least much stronger coordination between market layers, is likely to become an increasingly important design question. Instead of just creating more markets, the objective should be to ensure that flexibility is activated where it brings the highest system value at the lowest overall cost, rather than where the price signal is most attractive in isolation.

Should storage projects get priority grid access?

This was perhaps the most politically sensitive question of the roundtable. European TSOs are flooded with connection requests, and storage is increasingly seen as a resource that could help address curtailment, congestion, and system balancing challenges. That naturally leads to the question of whether storage projects should receive priority access to the grid.

The discussion was careful on this point. Participants agreed that the issue deserves to be studied and that TSOs can help provide advice on which technologies are most useful from a system perspective. But they also recognized that priority access is ultimately a political choice about what kinds of assets countries want to favor in their energy transition.

That distinction matters. From an operational perspective, storage can clearly bring value. But turning that value into preferential access requires governments and regulators to make broader choices about industrial policy, market design, and technology prioritization. The roundtable did not resolve that question, but it did underline how urgent it is becoming.